Denver’s Mile High Home Prices Slow, Foreclosure Rate Drops As Year Ends
As 2016 draws to a close, Denver area housing prices are slowing their climb but are still among the highest in the country, while the foreclosure rate is among the lowest.
The S & P Case Schiller Home Price Index reports Denver had the third fastest home appreciation last month, up 8.3 percent compared to last year, and behind only Seattle and Portland.
Still, the growth in home prices has steadily declined from the double-digit percentage increases of 2015. Last summer, Denver prices were up 11 and 10 percent over the previous year.
For those struggling to afford a home in the Denver area it’s cold comfort that price growth has slowed. As the city grapples with housing affordability, it's not clear whether these lower price increases will continue.
Thinking you might find a deal on the foreclosure market? Through October, foreclosures fell to just a 0.5 percent of all mortgages, per the latest data from Corelogic.
Real estate agent Justin Knoll, who runs Madison & Company in Denver, says some buyers often hear from friends and family in other places -- like the Midwest -- that they should find a foreclosure. But Knoll says, when those opportunities do come on the market, “they’re not screaming deals.”
“The banks are not stupid," he said. "They know what they’re doing and they need to get their loss back, so they’re putting it on at market value, and we’re just not seeing deep discounts anymore.”
That’s because home prices have grown quickly in the last five years -- up 50 percent since late 2011 -- and one reason the foreclosure rate is so low in the first place. Also, the job market is strong right now so homeowners can keep up with their mortgages. The unemployment rate has fallen below 3 percent from Fort Collins to Boulder to Denver.
During the housing crisis, Knoll found himself doing lots and lots of short sales -- when a house sells for less than what’s owed to the bank to avoid a foreclosure -- “so it’s pretty interesting to see how quickly that shifted.”
“We have not seen short sales in quite some time,” Knoll said. “I think that people who have just started in the business in the last couple years, when you say ‘short sales’ they don’t even know what that means.”
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